Pakistan's Religious Affairs Minister Ejaz-ul-Haq told the BBC the hostages are being held in a religious school attached to the Lal Masjid mosque, where a standoff began after a gun battle that left several dead last Tuesday.
"The situation still is that the control of Jamia Hafsa and Red Mosque is now in the hands of the militants who were taken in by the brothers to guard them," Haq was quoted as saying.
He said up to five "hardcore terrorists" are inside the complex.
Several hundred radical Islamic students who had barricaded themselves in the mosque to press their demand for imposition of strict Islamic laws in Islamabad have surrendered -- but several hundred more, led by the mosque's leader Abdul Rashid Ghazi, are still inside.
Haq told the BBC a militant killed earlier has been identified as a member of an outlawed Pakistani radical Muslim group with links to al-Qaida. However, Ghazi has denied any such members are inside the mosque.
In a statement Saturday, Pakistani President Pervez Musharraf said the students had no option but to surrender.
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